Talent2 Statement on Novopay implementation

In
response to questions about the implementation of the
Novopay payroll solution, Talent2 would like to provide the
following update from its Group CEO, John Rawlinson.

As
of Friday 16 November, 8,000 transactions have been cleared,
and we are confident the next payment period (pay period 18
which is paid in full to staff on 28 November) will be
delivered on time and within the standard expectations. We
acknowledge that there will still be outstanding issues, but
we are committed to and seeing continuous improvement.

Talent2 apologises for the inconvenience that payment
disruptions and inaccuracies have had on New Zealand
teachers, principals, support staff, and their respective
schools as they have transitioned from the incumbent legacy
system to the new Novopay solution. Talent2, together with
the Ministry, have been working around the clock to resolve
the issues surrounding this complex transition, and we are
both dedicated to providing extra support as required. We
are genuinely sorry for the stress that this has caused the
education sector and we are confident we can resolve the
issues.

Talent2 is the number one provider of payroll
solutions in Asia Pacific and delivers complex payroll
solutions for clients in over 30 countries, with a
specialism in the government sector. Talent2 is drawing on
its vast experience with complex implementations, including
17 years operating in New Zealand, to ensure Novopay is a
success. We are undertaking a number of actions to ensure
Novopay is stable and effective. The best way to make this a
success is by working closely with the Ministry and the
Education sector.

From Monday 19 November, all schools
are being contacted as the Ministry takes further steps to
resolve issues. A specialist team from the Ministry and
Talent2 is calling every school to ensure they are supported
for the year end and to get a full understanding of any
other issues.

Novopay is the largest single payroll in
New Zealand and one of the largest in Australasia. Since
Go-Live in August, Talent2 and the Ministry have
successfully managed over a billion dollars in salary
payments, made over 550,000 separate pay transactions and
managed 50,000 calls. The solution that pays approximately
100,000 education staff is managed by over 150 dedicated
Talent2 staff, supported by five local New Zealand
organisations, out of two delivery centres in Christchurch
and Wellington.

Given the size and complexity of this
implementation, there were inevitable teething issues during
the transition period. For a payroll of this complexity it
is not unusual for a very small percentage of those being
paid to have issues with their pay. Nevertheless, Talent2
are confident the project is on track to efficiently and
securely process future transactions and ensure staff are
paid correctly, on time and with their personal details
protected.

The Ministry of Education went to market with
a request for development and operation of an online
schools' payroll service. Talent2 won the contract following
an open and competitive tender process, as confirmed by the
Ministry.

Ian Clarke, CEO of leading New Zealand IT
services company Fronde that provides subcontracted services
related to the IT infrastructure that Talent2 uses to
deliver to the Ministry, says, “Fronde has worked
alongside Talent2 for many years, providing resources to
support Talent2’s IT infrastructure. In our experience
Talent2 is a professional and capable organisation that
sticks to its commitments.” Don Sykes, CEO of New Zealand
based software Development Company Asparona, added, “We
have worked with Talent2 on developing the Novopay solution,
and we have full confidence in their software and its
applicability to meet the requirements of both the Ministry
and the sector”.

The Talent2 Board, as well as local
and international teams are committed to making this project
successful for schools, staff, the Ministry and the New
Zealand tax payer. Together with the Ministry, Talent2 is
focused on improving the process to ensure the
implementation is a success and provides a future proof
system which moves from the legacy platform to a
state-of-the-art solution which will deliver significant
benefits and cost savings to both schools, and the Ministry.
Ultimately, Novopay will result in significant savings for
New Zealand taxpayers.

We would like to reassure the
people of New Zealand that Talent2 has extensive experience
and proven capability in delivering large scale payroll
projects, with the business successfully paying almost one
million people in the region, as well as effectively
managing payroll for many New Zealand clients. Talent2 is
absolutely committed to delivering a high quality service to
the New Zealand government and its people, and we will do
everything possible within our means to work with the
Ministry of Education to ensure Novopay is a success.

Talent2 will provide further updates through the release
of statements when appropriate.

--

Novopay Questions & Answers

Novopay Questions & Answers

»
Q: How many staff/teachers are covered by the
Novopay payroll system? A: The number varies
between 90,000 and 110,000 per fortnight.

» Q:
What is the volume of pay instructions received within a
fortnightly pay period? A: We process approximately
2,500 new joiners, approximately 5,000 employment details
changes and 50,000-60,000 timesheet entries per pay period.
There are over 50 different types of pay instructions.

»
Q: Are all outstanding payments now up to date?
A: For the most recent pay period, pay period 17
which was paid last week on 15 November, the Ministry of
Education figures show that 92,465 school staff were
successfully paid with 15 non payments identified at this
point. Just 494 transactions were not processed before the
pay run, however not every transaction impacts pay.

As of 16 November, we have processed what is known as
the “backlog” of pay instructions that were received
between 22 August and the end of September. For the current
pay period all pay instructions received within the valid
cut off periods will be processed.

» Q: Are any
personal address and financial details of payees being
released? A: No details are being released. In a
relatively small number of cases, some data of payees was
able to be seen by users at other schools who were
signatories or authorised users in their own schools.
However details of their pay were never visible. This is not
an issue with the system, but the access levels of some
users. This is known to both Talent2 and the Ministry, and
changes are being made to avoid this happening in the
future.

» Q: What exactly are the errors and
what caused them? A: This is a complex
implementation, certainly the largest payroll project in New
Zealand, so it is natural for there to be some transition
issues. The problems have come from some human errors in the
pay centres, some technical problems and what would be
considered normal change related difficulties for users.
There was significant training and support for the
transition and we are re-examining some of the content with
the Ministry to improve the effectiveness.

For a
payroll of this complexity it is not unusual for a very
small percentage of those being paid to have issues with
their pay as per standard industry benchmarks.

»
Q: Was sufficient support and training provided to
school administration staff? A: Online training,
webinars, online help, FAQs, among other methods have all
been available and again we are working collaboratively with
the Ministry to ensure we help schools further.

»
Q: Why has Talent2 been silent about the system’s
errors and complaints from schools? A: Talent2 was
legally constrained by a contractual clause (24.3) which did
not permit us to make any public comment on the project’s
status. This clause has now been revoked thus we are
communicating with the media today and will be on a regular
basis moving forward.

» Q: Will Talent2 provide
support over the Christmas period? A: Yes, from
Monday 19 November, all schools are in the process of being
contacted as the Ministry takes further steps to resolve
issues. A specialist team from the Ministry and Talent2 is
calling every school to ensure they are supported for the
year end and to get a full understanding of any other
issues.

Talent2 Core Business Questions &
Answers

» Q: Who is Talent2?
A: Talent2 is the leading Human Resources Business
Process Outsourcing (HR BPO) and Managed Services
organisation in the Asia Pacific region, working with
clients across diverse business types and industries to
deliver end-to-end talent management solutions. These
include HR Advisory, Payroll, Recruitment, RPO and Learning
solutions to enable organisations to improve the power and
productivity of their people.

Founded in 2003,
Talent2 operates from over 40 offices providing services in
30 countries across Asia Pacific, Middle East, UK and USA.

It is the recognised market leader in HR and recruitment
in Australasia and Asia. Talent2 is the number one Payroll
Outsourcing provider in Asia Pacific with 14% market share
(NelsonHall) and is the third largest provider of learning
in Australia. It is the number one in recruitment process
outsourcing (RPO) in Asia Pacific (NelsonHall) and the
pioneer of RPO in Asia.

» Q: Who owns the
company? A: In 2012, Talent2 was privatised by its
founders, Geoff Morgan and Andrew Banks, through Morgan &
Banks Investments (MBI) in partnership with Allegis Group,
Inc. Allegis Group, Inc., a private company founded in 1983,
is a staffing and workforce management company based in
Maryland, USA.

» Q: When did you start
operating in New Zealand? A: Talent2 launched its
New Zealand operations in 2005, through the acquisition of a
local recruitment firm. This also marked the start of local
payroll operations, following the acquisition of HRIS and
payroll software company, Concept Systems International in
2003. Through Concept, Talent2 has over 17 years HRIS and
payroll expertise in the New Zealand market.

»
Q: How many people do you employ in New Zealand?
A:We don’t break down staff numbers by geography
but we can say we employ more than 1,700 people in 40
offices across 19 countries and that we have been operating
in New Zealand since 2005.

» Q: What experience
do you have designing and managing similar payroll
solutions? A: We process more than 970,000 payslips
processed per month, supporting 31 countries. We manage
payroll for more than 2,400 clients and 740,000 employees in
Asia Pacific.

» Q: What experience do you have
in the Government and Education sectors? A: Talent2
has extensive understanding and experience in delivering
payroll services in the public sector, we partner with over
50 government agencies and over 30 education institutes in
the Asia Pacific region, including 6 public sector clients
in New Zealand.

» Q: What services do you offer
as part of your payroll solution? A: Our payroll
services can be delivered as a standalone service, or can
form part of a Multi- Process Human Resources Outsourcing
(MPHRO) solution. Our full MPHRO services include: Employee
and Manager Self Service

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